Answear.com Boosts Sales in a Challenging Market in Q1 2024

Answear.com, a leading e-commerce platform offering fashion, home & lifestyle products, and outdoor goods in the Central and Eastern Europe (CEE) region, has summarized its sales results for the first quarter of this year. Revenue from sales in the first three months of 2024 amounted to PLN 289 million, representing a 7% year-on-year growth. The company has improved its sales performance and maintains its status as the fastest-growing fashion e-commerce entity in Europe, despite a variety of negative market and geopolitical factors.

- The first quarter of the new year presented challenges for us on several fronts: weak consumer demand resulting from the macroeconomic situation, an unusually warm winter that did not support winter collection sales, and a blockade on the Polish-Ukrainian border, which reduced demand in the Ukrainian market – comments Krzysztof Bajołek, CEO of Answear.com.

In response to weak consumer demand in the second half of 2023, Answear.com decided to reduce its purchasing budgets for the Autumn-Winter 2023 season to align inventory levels with market conditions and avoid overstocking. This cautious approach to reducing purchasing budgets had a negative impact on revenue levels during the winter sale period, but resulted in a positive outcome in the form of low inventory levels post-season.

- Among the series of negative factors that impacted our business last quarter, we also have to include the appreciation of the Polish złoty against the euro and other CEE region currencies. As an exporter, approximately 80% of our sales are conducted outside of Poland, which means that our revenue dynamics are influenced by fluctuations in the Polish currency. Adjusting for the impact of the strengthening złoty, the company would have reported a sales growth increase of approximately 10 percentage points – adds Jacek Dziaduś, CFO of Answear.com.

In Q1 2024, the average exchange rate of the euro in relation to the Polish złoty decreased by 8% year-on-year, the Ukrainian hryvnia fell by nearly 17% in the same period, the Hungarian forint by nearly 8%, and the Czech koruna by about 13%.

- Despite the very difficult market situation, we continue to increase sales and maintain positive growth dynamics, positioning us as the fastest-growing fashion e-commerce in Europe. Of course, we aim to return to the growth levels our investors have come to expect from us as soon as possible, hence we are hopeful that in the next quarter we will be able to report better sales results  – says Krzysztof Bajołek.

Answear.com positively evaluates the first weeks of the already started Spring-Summer 2024 collection sales, which, combined with an assessment of quality and appropriate inventory levels for the upcoming season, provides a basis for expecting better sales results in Q2.